SPIRO T. AGNEW, Governor                        1391

(2) No bonds shall be issued by any code county except for cash
or be sold at less than par value thereof, nor shall they bear interest
at a rate or rates in excess of five SIX per centum per annum; and

(3) If a valid petition for referendum is filed with the Board of
Supervisors of Elections in regard to a public local law enacted by the
Board of County Commissioners of a code county and authorizing the
issuance of bonds, the bonds authorized by the public local law shall
be issued only if a majority of the registered voters voting on the
public local law approve it; and

(4) All bonds sold by a code county shall be subject to the pro-
visions of Sections 9 to 11, inclusive, of Article 31 of this Code, as
amended from time to time, unless the public local law authorizing
the bonds specifically exempts them from the provisions of these
sections.

17.    Bonds to be negotiable; exemption from taxation.

All bonds issued by any code county in accordance with this sub-
title shall have and possess all the attributes of negotiable instru-
ments as provided in Section 8 of Article 31 of this Code and in
Section 8 of Article 95B of this Code. The principal of and interest
on any bonds in the hands of the owner or owners thereof from
time to time shall be and remain exempt from taxation of any kind
or nature whatsoever by the State of Maryland and by any county,
municipal corporation, or other political subdivision thereof.

18.    Investment of sinking fund and proceeds of bonds.

A sinking fund established by any code county to provide for the
payment of the principal of or interest on any bonds issued by the
code county pursuant to the provisions of this subtitle shall not be
invested by the fiscal officer of the county having custody of the
sinking fund except in the manner prescribed by Sections 6 and 7
of Article 31 of this Code. Any fiscal officer having custody of the
proceeds of sale of the bonds may invest the proceeds, pending the
expenditure thereof, in the manner and pursuant to the provisions
of Section 22 of Article 95 of this Code.

19.    Bonds to constitute pledge of faith and credit and taxing power;
effect of limitation on tax rate or county indebtedness; pledge
of additional revenues.

(a)    Pledge of faith and credit of county. Except as provided in
Section 20, all bonds issued by any code county pursuant to this
subtitle shall constitute pledges of the faith and credit of the issuing
county to the prompt payment, from the taxes and other revenues
described in the public local law authorizing such bonds, of the prin-
cipal of and interest on the bonds when due.

(b)    Covenant to levy taxes. If at the time of the issuance of the
bonds there is no statutory limit on the power of the code county to
levy property taxes, this pledge constitutes a covenant on the part
of the county issuing the bonds to levy upon all real and tangible
personal property within its boundaries subject to assessment for
unlimited county taxation, ad valorem taxes in rate and amount suf-
ficient in each year in which any of the bonds are outstanding to
provide for the payment of the principal of and the interest on the
bonds.